The TBT Agreement only applies to certain kinds of measures, including "technical regulations." Is the Seal Products measure a technical regulation? Here's the definition of technical regulation:
Document which lays down product characteristics or their related processes and production methods, including the applicable administrative provisions, with which compliance is mandatory. It may also include or deal exclusively with terminology, symbols, packaging, marking or labelling requirements as they apply to a product, process or production method.
Back in the EC - Asbestos case, the Appellate Body said:
72. Although this prohibition against products containing asbestos applies to a large number of products, and although it is, indeed, true that the products to which this prohibition applies cannot be determined from the terms of the measure itself, it seems to us that the products covered by the measure are identifiable: all products must be asbestos free; any products containing asbestos are prohibited.
75. Viewing the measure as an integrated whole, we see that it lays down "characteristics" for all products that might contain asbestos, …
The Appellate Body thus concluded that the measure was a technical regulation subject to the TBT Agreement. In essence, the measure regulates all products that might contain asbestos, by prohibiting them from containing asbestos.
Now in Seal Products, we also have a measure that bans an input product that is used in various other products. That is, it regulates final products that might be produced using seals, requiring that they cannot contain seals.
In asbestos, the use of asbestos in other products led to the asbestos ban being deemed a technical regulation of those products. Will the use of seals in other products lead to the measure at issue being deemed a technical regulation in regard to those products?
There is one important difference: In Seal Products, there are exceptions to the ban, so the use of seals is not completely prohibited. They can be used to a limited extent. Here's the EU argument on this point:
215. Concerning such products containing seal (and other ingredients), Canada and Norway primarily argue that the EU seals regime lays down intrinsic product characteristics in negative form by providing that all products may not contain seal. In doing so, they attempt to establish parallels between the EU seals regime and the measure at issue in EC – Asbestos. In the latter case, the Appellate Body found that the relevant measure included the regulation of products containing asbestos fibres which effectively prescribes or imposes certain objective features, qualities or "characteristics" on all products. That is, in effect, the measure provides that all products must not contain asbestos fibres.
216. The complainants' argument ignores that the EU seals regime is not limited to prohibiting the placing on the market of products containing seal (Article 3 of the Basic Regulation), but that it also provides (in the same provision of the Basic Regulation) for three exceptions under which products containing seal may be placed on the EU market. These permissive elements supplement the aforementioned prohibition and, thus, together with the prohibition determine the situations in which seal products can be placed on the EU market. The determination of whether the EU seals regime lays down product characteristics must, therefore, take into account the three exceptions.
217. This follows from EC – Asbestos in which the Appellate Body held that "the proper legal character of the measure at issue cannot be determined unless the measure is examined … as an integrated whole, taking into account, as appropriate, the prohibitive and the permissive elements". In that case, the Appellate Body explicitly stated that "the scope and generality of those prohibitions can only be understood in the light of the exceptions to it".
219. Therefore, the EU seals regime must be examined as an integrated whole taking into account the three exceptions. The prohibition that products containing seal must not be placed on the EU market must be understood in the light of the three exceptions which provide that products containing seal can be put on the EU market under certain conditions. What is decisive for the characterization of the EU seals regime is that none of the three exceptions lays down product characteristics within the meaning of Annex 1.1 of the TBT Agreement.
Thus, here, final products may contain seals, although this possibility is limited in practical terms because only a small amount of seals are likely to be available on the market.
So with all that in mind, here's the question: Is the EU measure a "technical regulation" in relation to those products that might contain seals?
(Note that there were some exceptions to the asbestos ban -- the EU addresses this in para. 224.)